Providing a monetary rebate program for purchasing a product:
A)Is accounted for similarly to product warranties.
B)Creates an expense for the seller in the period of sale.
C)Creates a contingent liability for the seller at the time of sale.
D)All of the above are correct.

Question

Quizplus · Accepted Answer

A rebate program creates an expense for the seller in the period of sale and a contingent liability at the time of sale. It is not accounted for similarly to product warranties.

Providing a Monetary Rebate Program for Purchasing a Product